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Ten Common Errors When Starting A New Business

7 Aug

Congrats on your new business.  This can be the beginning of the most amazing and fulfilling period of your career.   However there are some common errors you need to avoid.  In their blog “Ten Mistakes To Avoid When Starting A New Business”, wix.com provided this list of (10) most common mistakes new entrepreneurs make and should avoid:

1) Not Researching Your Target Market – You need to know their habits and behavior as consumers. The more you know about the people you want as your clients, the more focused and cost-effective your marketing plan will be.

2) Sketchy Business Plan – You must have some type of financial forecast for expenditures, an initial marketing plan, a breakdown of your target audience and your competition, and most importantly some idea of how you plan to be profitable.

3) Getting Loans from Friends and Family – If you have a great idea and a well-organized business plan, you should be able to receive loans from institutions that specialize in these matters. Do you want to risk the relationship with people that you love? Be smart and resist the temptation, even if they offer.

4) Expecting Immediate Profit – New businesses usually take two years to become profitable. Make sure you have enough capital to carry you through, because in the beginning you will mostly be spending money, not making it.

5) Not Focusing on the Customer – You need to focus on offering solutions.  That is where your real profit lies. If your business provides something of substantial value you will get loyal clients that happily recommend your services.

6) Disregarding Controlled Testing – The only way to find out exactly what works for your business is to plan, test and analyze.  Do this in a controlled fashion and on a small scale. Don’t blow all of your investment money on random advertising or mass marketing. Test out different strategies on a small group and obtain feedback before you make any major move.

7) Relying on Your Own Legal and Accounting Skills – Do not trust yourself with something so critical as your own business. Experts are considered experts for a reason

8) Trusting Verbal Agreements – When money is involved, you need to have a written agreement to secure your interests. Contracts are not just a formality. When you sign one, make sure you actually understand and agree with its content.

9) Trying to Do Everything Alone – There are so many things to look after with a new business. Even if you’re planning a small operation, you will find yourself in need of assistance – even on a part-time basis. Seek out people whose abilities balance out yours, so that you can focus on developing your ideas and making deals.

10) Sacrificing Personal Relationships for the Biz – Most entrepreneurial efforts require around the clock attention, and can strain family and close relationships if you allow them to. You need the support of your loved ones, so don’t neglect them. Maintaining a healthy private life is crucial for your well-being. If you don’t, eventually, your business will also be affected by it.

You may read wix.com’s full article here http://www.wix.com/blog/2013/07/common-business-mistakes/

 

Six Steps To Start Up Success

22 Jul

Achieving start up success is difficult and as a result many fail.  However following the below advice from Bob Diener is a great place to start.

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Six Fundamentals Every Entrepreneur Needs to Succeed

by Bob Diener

As an entrepreneur who founded and runs a successful and growing business, Getaroom, I see many entrepreneurs with great ideas but no clue how the business will be profitable. For certain websites or apps, if the idea is good enough you can get lucky and sell the business after you get a spike in interest. However, most companies require considerable planning and need both a competitive advantage and a solid business plan in order to succeed. For my company, I focused on a big market and found a profitable and attractive niche.

If you’re thinking about starting your own company, here’s my advice:

Set realistic expectations.
While enthusiasm and faith are needed when planning out your business, you do want to temper those thoughts with realism. Your projections for the business should not be wildly optimistic so you can manage your expectations and those of any partners. Consider the type of business and industry. Are you selling a lower margin product that will take time to gain traction? Or are you taking a shot with an app that might be a dud or might attract 100,000 downloads a month? Plan for a realistic amount of sales and interest so you can conservatively manage your finances. Are you counting on advertising to bring in customers? Remember that most advertising simply does not work, and you’ll need to attract customers through other channels and the power of word-of-mouth referrals.

With Getaroom, I understood the lodging market is massive and knew a niche player could capture a large amount of revenue, but my initial projections were modest and I watched expenses closely.

Have a clear value proposition.
Your product or service should offer true value. The value assessment has to go beyond your own biased opinion. You’re invested in the business, so of course you’ll feel it has value for your customers. Gather some outside counsel to be sure the value is clear and easily explained to your targeted audience. Envision someone referring your service to a colleague, saying “You need to get Service X because it will help you do A, give you B, and offer you insights into C.” If the value proposition is unclear, then you’re likely setting up the business for failure. Getaroom.com’s value proposition is based upon superior pricing and service. In an environment with rate parity such as in lodging, companies that can offer consumers reduced prices and exemplary service are able to really stand out as valuable.

Offer unique attributes.
Does your intended service or product bring something new to the consumer? If they already possess what you are offering, can get it for free, or can an easily acquire it from myriad competitors, then how do you expect to stand out? Will customers be able to identify and discuss your competitive advantage? Getaroom stands out because it presents a new model for hotel room booking. It features an unpublished rate program which gives consumers typically 10 to 20% (but up to 70%) off standard rates at thousands of partner hotels who want to move room inventory. What is markedly different about the company is these rates are only available through the Getaroom.com call center. The model is also different because we tell the traveler the name of the hotel, but not the actual rate until they book, while other models offer the rate but not the hotel name. We serve a clear segment of travelers who are looking for deals, but who also want to control where they stay. That sets us apart from our competitors. What attributes would set your venture apart from the competition?

Find your niche in a sizable market.
Knowing your clear value proposition and your unique attributes will help you determine where you fit in the market. We don’t offer every possible hotel, but we do offer unpublished rates for tens of thousands of the very best. Lodging is a $500 billion annual business, so for Getaroom, we don’t require too much of a share of that market sum to reap considerable rewards. Travel is a good market for entrepreneurs, but it’s not the place for copycats. You can’t compete with big booking sites unless you have an angle. Several of the large online travel agencies have a model of offering access to all hotels in every location; their angle is the sheer breadth of coverage. Others travel sites outsource their call centers overseas and really push all interactions to be electronic.

At Getaroom.com, we are a deal and value site, where we use pricing and a well-trained call center to stand out. We built a U.S.-based call center staffed with highly trained agents so they can offer enhanced services and act more like a travel agent than just a process person.

In large and expanding markets, there is always a value proposition to be found with niche players who can provide a compelling service. In travel, there is always someone looking to help research it, track it, or provide services for certain areas or class of travel. As long as the niche service has a true value proposition and a reasonable market audience, it can pull in profits.

Design a sound business model.
An entrepreneur can have the most unique product offering, one that offers tremendous value, but if her underlying business plan is not sound she has nothing. A quality plan is the key “how” of a business: how you are going to move forward with your service while keeping costs down? How do you ensure there will be demand for your product that can be reasonably sustained over the long term? How will you market your product or service to the intended audience on a reasonable budget? You need to be a hawk on the bottom line and ruthlessly manage top line expenses. The hard truth is that most businesses fail, and not always because the idea itself was not sound. A well-constructed economic plan does not of course guarantee success, but it is necessary and can turn a failure into a learning experience instead of a catalyst for personal financial ruin.

A sound model doesn’t mean you can’t deviate from the model and innovate when it is the right call. For instance, we instituted flash sales, where travelers have a limited amount of time to book, typically up to 24 hours. We usually offer these sales at 10 to 60% off, which creates an incentive for immediate action. This model is also a great driver for traffic to the site, as these sales are not pre-announced, but just pop up whenever the timing is right.

Pull in customers cost-effectively
Once you have the product or service and a solid plan lined up, you need to drive customers to make purchases. As I mentioned before, advertising typically does not work. Look at inexpensive promotions or contests and your social media strategy as cost-effective ways to attract consumers. Encourage conversations about your brand by asking for reviews or finding a way for consumer-created content that shows off your product’s unique features.

While none of this advice may seem particularly surprising, I’m always amazed by how many entrepreneurs have neglected to do this homework before they launch. If you want to beat the odds, make sure you’ve carefully thought through these non-negotiables before you start your business.

You may read the original blog here: http://blogs.hbr.org/cs/2013/07/as_an_entrepreneur_who_founded.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+harvardbusiness+%28HBR.org%29&cm_ite=DailyAlert-072213+%281%29&cm_lm=sp%3Afranciscajordan%40gmail.com&cm_ven=Spop-Email

What Motivates Employees Today? Recognition, Growth and Fun!

10 Jul

badgeville

A recent infographic released by Badgeville confirms that raises or monetary rewards will not necessarily motivate employees and opportunities for growth was the top reason they stayed in an organization.  Here are some other statistics they shared:

1) 71% of employees are not engaged

2) 70% of workers are more motivated by non-monetary rewards at work

3) 83% said recognition for contribution is more fulfilling than any rewards and gifts

4) 76% said opportunities for growth was the top reason they stayed in an organization

5) 90% find a fun work environment very or extremely motivating

6) 79% of those who quit their jobs cite lack of appreciation as the main reason

Here’s the link to Badgeville’s full infographic shown below: http://www.badgeville.com/motivate

Your Start Up Not Performing As Well As You Planned? Focus On Success!

14 Jun

Working for yourself isn’t easy.  It takes a lot of perseverance and self talk to keep going and keep believing in yourself and your company.  It is also important to put aside time at planned intervals to reflect on where you’re at and determine what if anything needs tweaking.  I therefore found this blog by Ellie Cachette to be inspirational as she recaps the various professional and personal challenges she faced since starting her company.  It’s a reminder to all entrepreneurs, that even when things aren’t going as well as you wish, “the greatest thing a founder can do, is make sure his start-up doesn’t die”….that is….. Focus On Success!

.What To Do When Your Start Up Doesn’t Fail, But Also Doesn’t Succeed

By Ellie Cachette, June 11 2013:

There were so many times our start-up almost failed, we joked it was a cockroach, a life form in its own right that, simply put, would never die.  There were times when we barely could pay our Rackspace bill, and one time I distinctly remember our blog being down because we forgot to pay that bill. There was also the time one of our investors cut our credit line in half, unexpectedly, right as we made a huge payment. And then the time our lead customer, two days before integration, committed suicide. Then the time a few weeks after that when our CTOs wife committed suicide.

There are so many things privately and publicly known about ConsumerBell that its nearly a miracle that we’ve made it where we are today. Any person close to us will say we have had no shortage of miracles and most startups that really make it far have similar stories; years where founders did contract work, or full teams were let go. We even moved my full apartment into the office hallway for a day while I was 24 hours between a lease, and experienced two hurricane blackouts in NYC and an earthquake that rocked our Park Ave office one summer.

Many of these things happened in our first year as a startup when our sole focus should be product. I remember after a trip to D.C, a water pipe exploded above our printers. We just went around the corner to a cafe. There’s always a wifi spot, a cup of coffee or an employees apartment to stakeout. ConsumerBell just would not die.

Similarly to a recently engaged couple and the way grandparents always ask, “When are you having kids?” there reaches a point where for a startup people are wondering, when you are going to IPO or raise the next round? Or have rocket ship growth? And sometimes it just never happens or even worse, sometimes like with Pandora or Tumblr it takes a while. There is this correlation between staying alive and rocketship growth. To get there the first part is staying alive and many other variables added to rocketship growth. Simply put just breath.

Yet at some point something changes: the founder gets bored, the company starts making money in a pivot that wasn’t part of the original vision or even funds run low but not low enough to justify shutting the doors – especially when there’s revenue involved. Sometimes a startup is well funded but just can’t seem to see a path of success like it thought and returns its money to investors, sometimes the market changes or the industry changes and now what was a “big” idea is only a feature but something need and so is true for the opposite when what was once a feature in time becomes a company.. Not every startup becomes a huge success like Facebook but not every startup fails either. There are plenty of startups in the middle, in purgatory of success waiting for the right VC or new CEO or market environment to change.

In the meantime what is a team or founder to do?

1. Sabbatical

From what I have heard, founders who take sabbaticals or vacations actually come back refreshed and with a new sense of balance. There’s a couple reasons for this: after massive sleep deprivation and zero separation between work and personal life, taking a step back often reminds a founder of the things that they want in their personal life and gives motivation to the work life and while in a lull this can upset investors or look like avoidance, its in almost every case helped the company and lets be honest, if a company is going to die it isn’t going to die in one week but be surprised at how much sleep a founder might need and you probably wouldn’t want many friends around. Stories of founders sleeping for days straight are not uncommon.

2. Reflect and Document

Having a lull or time for reflection can also be inspiring, its a good time to document all HR files, product road maps, organize digital assets, clean up email boxes and media content accounts like YouTube, upload missing content, re-share content on twitter. In many cases potential acquirers will be want to know many of these things like how many digital assets (files and images) to taxes and press lists. It never fails that when the acquisition opportunity arises founders are usually too busy with other things so doing it when possible is not only therapeutic but efficient. Also in the process you might find a gem or two of inspiration.

3. Help Other Startups

Dedicate a portion of time to help other startups in different phases. This will be refreshing to transfer knowledge and also help spread the word of what you are working on in a way that could spark new ideas or allies. When all seems lost helping others often reminds a founder of the world outside its own startup and can give perspective.

4. Do Something Different

One thing founders certainly give up is their personal lives and can albeit even forget what a personal life is making decision one sided. Take a class, do something random, spend a week with family somewhere far. Do something totally different and step out of the founders role.

5. Don’t shut down

airBnb had to sell cereal at one point to keep their company alive, in the early days of FedEx their CEO gambled his money at blackjack to win and make payroll. Evernote the night before closing its doors received a $500k investment from a user in Sweden and Blogger (which sold for rumors between $20MM and $50MM) to Google had to lay off every single employee before finally getting acquired. That founder, Evan Williams went off to start what is now Twitter today, so the greatest thing a founder can do when their startup isn’t failing is to make sure it doesn’t die. Timing is everything.

Read more: http://www.businessinsider.com/what-to-do-when-your-startup-doesnt-fail-but-also-doesnt-suceed-2013-6#ixzz2WBzIJkw6

Four Reasons Why You Should Hire A Female Executive

10 May

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Regardless of our roles, to achieve success as a team, we must appreciate and leverage on each team member’s strengths.  I liked this blog by John Baldoni “Few Executives Are Self Aware, But Women Have The Edge” since it highlights often ignored strengths of female team leaders.

Few Executives Are Self-Aware, But Women Have the Edge

by John Baldoni

http://blogs.hbr.org/cs/2013/05/few_executives_are_self-aware.html?referral=00563&cm_mmc=email-_-newsletter-_-daily_alert-_-alert_date&utm_source=newsletter_daily_alert&utm_medium=email&utm_campaign=alert_date

So is the best man for the job a woman?

Research by Hay Group, culled from its 17,000-person behavioral competency database in 2012,finds that when it comes to empathy, influence, and the ability to manage conflicts in the executive level, women show more skill than men. Specifically, women are more likely to show empathy as a strength, demonstrate strong ability in conflict management, show skills in influence, and have a sense of self-awareness.

“Women often face barriers throughout their careers that require them to develop these skills to excel and advance in their organizations,” says Ruth Malloy, global managing director for leadership and talent at Hay Group. Malloy adds that the shift from hierarchy where individual achievement matters to matrix organizations where teamwork counts put a premium on the skills that women have mastered.

“Influence and conflict management are not necessarily inborn, these competencies more often are learned,” Malloy added in an email interview. Research by Hay Group found that “women scored higher on these matrix competencies compared to their male counterparts. My hypothesis is that these women who broke the glass ceiling as a population acquired and demonstrated more of these competencies to overcome obstacles to succeed.”

“I think women leaders do have to manage the female stereotype of being more relationship focused, softer or nicer,” says Malloy. “Behaviors associated with strong leadership tend to be more consistent with the masculine stereotype.”

“Women face the double-bind when taking on leadership positions. If their behavior is too feminine they are seen as too soft and incompetent, however if their behavior is too masculine they are perceived negatively.”

So why, despite these strengths, don’t we see more women in senior management? The reasons are complicated, even for ambitious, highly skilled women. One reason may be that successful women managers must demonstrate more leadership skills. According to Malloy, “Research the Hay Group conduced on outstanding women leaders found that they navigate this double-bind by using a combination of both stereotypically masculine leadership styles (e.g., being Authoritative or Visionary) and feminine leadership styles (e.g., being more Affiliative or Participative).” Men by contrast only need to demonstrate the “masculine” leadership styles.

Another challenge is how these top job openings are framed. When the role is framed less as an opportunity to demonstrate acquired expertise and more as a role that would give a high potential candidate a chance to grow and learn, “women and other diverse constituencies are more likely to be recognized” as suitable for promotion to senior positions. That’s assuming, though, that their skills and strengths have been recognized. And that’s the third obstacle: recognition for strong interpersonal skills is not straightforward. As Malloy says, “these [interpersonal] competencies are also more challenging to demonstrate.”

Finally, the single area where both female and male managers need to improve is in self-awareness. While women did outperform men on that metric, notice how low the rates for both genders are — under 20%. “If you think about most people in our day-to-day lives we tend to run on auto-pilot,” says Malloy. “We often are not mindful about our impact on others or how and where we spend our time. We can easily get caught up in the task or the day-to-day distractions” and pay less attention to ourselves and effect we may have on others.

“Improving self-awareness requires getting some source of credible feedback, and being open to that feedback,” she advises. “Find a trusted colleague or someone from your personal life who can give you constructive feedback in real-time.”

Malloy continues, “Developing self-awareness also requires reflection… Schedule time every week on your calendar to reflect on what went well, what did not, and how could you react differently in the future.”

Self-awareness is essential to effective leadership. A leader must know herself — her abilities, her shortcomings, and her opportunities for growth in order to be able to provide direction, guidance and inspiration to others.

Leadership demands strong interpersonal skills. And while research may show that women leaders have the edge in certain areas, the lesson I take from this study is that both men and women have work to do in order to become the leaders their followers need.

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John Baldoni is president of Baldoni Consulting, a full service executive coaching and leadership development firm. His newest book is The Leader’s Pocket Guide: 101 Indispensable Tools, Tips and Techniques for Any Situation

Why more men should speak up about women and leadership

7 May

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As  a Director at the Association of Female Executives of Trinidad and Tobago (AFETT) , part of my portfolio includes (of course) advocacy for women in the workplace.  However, this conversation is not one based solely on emotions.  There is numerous data which show that companies with more women in top level positions perform better.  But  unfortunately, it is a conversation that is not being directed at enough men.  Too  often women remain the main target of our dialogue.  I therefore fully appreciated Avivah Wittenberg-Cox’s blog “Male Bosses Need To Speak Up On Gender Balance” which correctly articulates that for us to achieve women’s equality at the board room and executive levels, men MUST join the conversation.  So for the women AND men reading this, why not review your company’s HR practices to include more family-friendly policies?

Male Bosses Need To Speak Up On Gender Balance

By Avivah Wittenberg-Cox

http://blogs.hbr.org/cs/2013/05/male_bosses_need_to_speak_up_f.html?referral=00563&cm_mmc=email-_-newsletter-_-daily_alert-_-alert_date&utm_source=newsletter_daily_alert&utm_medium=email&utm_campaign=alert_date

Does anyone else find it strange that the debate heating up in the US around gender imbalances in the workplace is overwhelmingly a conversation among … women? This constant frame of gender as a “women’s issue” is one of the big obstacles to progress — in both countries and companies.

Is there any doubt that women are where they are today in part thanks to the male partners — at home and at work — that accompanied them throughout the last half century’s revolutions? I have rarely met a successful woman who was not developed and promoted by at least one enlightened man.

The challenge is that progressive men are not always highly effective leaders on gender issues, in part because they have not been particularly involved in the conversation. It is high time they were. And high time more women invited them in.

In my experience working with companies, there are three main reasons that progressive men hesitate to speak up for gender balance:

1. It’s a no-brainer. The first group consider the case for gender balance so obvious that it doesn’t require elaboration or argument.

The challenge is that these leaders don’t think they need to convince anyone of the benefits of balance. They don’t think anyone needs to hear any kind of business case anymore — that is yesterday’s battle. They assume their teams are all aligned behind them, and all they need to do is communicate a target. They usually launch enthusiastically into the fray, overcommunicating their goal and underestimating the incomprehension that usually meets their efforts. They end up frustrated a few years on at the lack of progress. These leaders often waste precious years and goodwill on ineffective approaches (usually targeted at women, rather than at the entire organization). Essentially, they charge out of the closet — and into the frying pan.

As a result, these leaders often take overly aggressive approaches with unrealistic timelines that then create a backlash. They usually revisit the topic with more appropriate resourcing after a few years of unsatisfactory progress, or their successor quietly shelves their efforts.

2. It’s not worth fighting for (or being identified with). A second group are quiet supporters but don’t want to make it a big deal. It’s kind of like religion; something to be practiced quietly at home or in their own teams, but not preached about in public.

This is probably the attitude of most progressive men I’ve met. That majority status makes these men absolutely crucial to changing the cultures of the companies and countries where they work. Moreover, they are currently developing, promoting and financing tomorrow’s talent. This requires the skills and engagement to be proactively leading on gender. Yet in many of the sessions I run, it is the nay-sayers that are loud, assertive and argumentative. The progressive men hold back, occasionally suggesting a caveat to a reactionary’s voluble bluster. It takes a lot of courage for men to stand up to other men on the topic of gender balancing.

And yet too many progressive men are taken aback by some of the reactions and often decide that gender is not priority enough to be worth fighting for. They let the louder voices dominate the debate.

3. It will happen naturally. A final group of leaders are the ones who already have gender balanced their teams. They argue that it is a simple case of meritocracy: recognizing and promoting the best people. They assume that since the pipeline of colleges, graduate programs, and entry- to mid-level jobs are full of high-performing women, that merit will win out and eventually women will start to make it in real numbers to the senior levels.

In doing so, they underestimate their own skills and “gender bilingualism.” They don’t recognize that their own abilities to recognize talent equally well among both men and women is an unusual skill that not all managers possess. They are usually reluctant to spend much time and effort in equipping others with the skills and awareness that they themselves take for granted. This blind spot has much the same effect as the others — ineffective leadership on the issue.

If you’re reading this and recognize any of your own impulses here, there are specific actions you can take to have more influence on this issue. First, learn how to lead on gender or learn how you already do. Ask for feedback from your team, about how your management style may differ from others they have experienced. Know the data relevant to your sector and company. Second, recognize that your colleagues may not buy the idea of equality. So sell it. Third, recognize that even if your your colleagues like the idea of gender balance, they may not know how to get there. Teach them what you know. Finally, if you’ve decided to make this a major initiative at your firm — bravo! — just don’t appoint a woman to lead the charge. Male majorities buy the business case for gender balance better from a man.

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Avivah Wittenberg-Cox is CEO of 20-first, one of the world’s leading gender consulting firms, and author of HOW Women Mean Business (Wiley, 2010).

12 things to know before you take a job

26 Apr

Courtesy Ragan Communications: http://www.ragan.com/Main/Articles/46592.aspx

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